Update 7 December:  I’m grateful to Paul Montague of Blevins Franks for the information that EC has opened an infringement procedure against Spain for its obligation on fiscal residents with assets of over €50,000 outside of Spain to submit a Modelo 720 declaring their worldwide assets.

The legislation has been reviewed by the EC due to the fact that it may infringe the EU’s basic principles. The Spanish Government has been informed that the infringement procedure has been opened, and Spain now has two months to make the corresponding claims and arguments.

Blevins Franks say that everyone who is currently required to submit Modelo 720 should continue to file the information until Spain changes its law. This will probably take a very long time, perhaps several years. The information sheet from BF can be downloaded HERE.

Update 23 February: Paul Montague has kindly provided the following clarification to try to help people determine their situations more easily. There’s a direct link to his contact details in the update immediately below for anyone who needs further or more detailed information.

You will become resident for tax purposes in Spain if:

a) you spend more than 183 days in one calendar year. You become liable whether or not you take out a formal residence permit. These days do not have to be consecutive. Temporary absences from Spain are ignored for the purpose of the 183-day rule unless it can be proved that the individual is habitually resident in another country for more than 183 days in a calendar year,
b) your “centre of economic interests” is in Spain, i.e. the base for your economic or professional activities is in Spain.
c) your “centre of vital interests” is in Spain – i.e. your spouse lives in Spain and you are not legally separated, and/or your dependent minor children do. In this case you are presumed Spanish resident, unless proven otherwise, even though you may spend less than 183 days per year in Spain.

In Spain, split year treatment does not apply. You are either resident or not resident for the whole tax year (subject to any period of residence in another tax treaty country before or after your Spanish residence commences or ends).

If you move to Spain in the latter half of the calendar year, then you are likely to find that you are regarded as non-Spanish resident during that year, assuming you have not spent 183 days there during the year. However, this will depend on previous visits made to Spain, and if these have been significant or frequent, the Spanish authorities could deem you to be resident in Spain from an earlier date, and may merely regard any subsequent time spent outside of Spain as a temporary absence.

Update 22 February 2015: It’s asset reporting time of year again, and Paul Montague of Blevins Franks says that he’s receiving an awful lot of enquiries for information about it. He hopes that people might appreciate THIS guide specifically to completion of the Modelo 720. Paul has also previously provided THIS general guide to taxes in Spain. Like him, I hope this helps.

Update 14 March 2014:  Just a reminder that if you’re tax resident in Spain with assets outside of Spain worth more than €50,000 then you have until the end of March to submit model 720 to the Spanish Tax Office for the new declaration. If you did this last year – the first year that the declaration was required – then you only need to submit a new declaration if your assets have increased by €20,000 or more.

Update 9 April 2013: Blevins Franks has just answered one question that I’ve now been asked time and again, namely the status of a property in the UK that has a mortgage on it. To clarify: the owner is the individual named on the deeds, not the bank, which is considered simply to have a charge on the asset. As such, logically, and now confirmed, that charge is irrelevant for these purposes. The Spanish authorities want the value of a mortgaged UK property in total, disregarding the mortgage, and consider the value to be the original purchase cost. Further, BF says that the declared amount for the property going forward in future years is always the purchase cost as far as they can ascertain.

Update 8 April: An update to give clarification from Blevins Franks.The asset declaration applies to tax residents of Spain (or de-facto tax residents meaning those who live here full time but do not make a tax declaration). Under 99% of circumstances, a person is not deemed to be tax resident unless they spend 183 days or more in Spain so the swallows who spend 5 months a year in Spain for example, do not have to make a declaration for asset reporting.

Update 26 February 2013: There is an updated factsheet for the legal requirements on resident foreign assets reporting. Please click HERE to download it.

Original post 19 December:  I am indebted to Blevins Franks for drawing my attention to the fact that as part of more wide-ranging anti-fraud/black economy measures (which include the ban on business cash payments over €2,500), Madrid has amended its fiscal requirements on foreigners’ assets held outside Spain. The new legislation is Ley 7/2012 of 29 October 2012, and the rules came into force straightaway.

The Hacienda (Spanish Inland Revenue) now requires residents to report any and all assets totalling more than €50,000 held outside Spain; after the first declaration, these assets will need to be declared again if they have increased by €20,000. The penalties are apparently very serious, so it is in everyone’s interest to be aware of the requirements. I’ve uploaded a pdf advice sheet from Blevins Franks, please click HERE to download it: BF’s own website is HERE.

This article has 81 Comments

  1. A quick question. I hold 2 UK bank accounts jointly with my husband. We each make a separate tax declaration to the Hacienda. Am I right in thinking that I only need to report the existence of these accounts if the total value of my share of this particular asset (ie. 50%) is more than the stipulated 50.000€? For my husband and I to both report that we have the two accounts and give details of both balances as at 31 December would amount to double reporting and give the impression that we had more money that we actually have.

  2. Hi Carol, as I’ve said a few times before, I’m not an accountant and it is so far removed from any area of expertise that I am extremely reluctant to advise, or even comment sometimes! It seems to me, though, that you and your husband could (perhaps ideally should) be submitting joint returns, in which case the total of your assets would be singly reported. Given that you’re submitting individual returns, however, and also given that Spain deems assets held by husbands and wives to be held 50-50, then yes, logic declares that you would only have to declare your share, i.e. half. Logic isn’t always paramount in Spain, however, and regardless of what I might say, I’d still check this with whoever it is that does your annual returns, or an independent gestor/accountant if you submit your returns personally.

  3. Regarding:
    “The Hacienda (Spanish Inland Revenue) now requires residents to report any and all assets totalling more than €50,000 held outside Spain”
    I was just thnking how woule the Hacienda know to check this is?
    Surely such information is confidential. I would not be happy if my bank disclosed to anyone my curent or savings account balance.
    When you say “Assets” does thin include, for example, property and/of other non cash deposite?
    Sounds like its a difficult law to police of verify which ever way you look at it so what’s the point in declaring anything?

  4. As I understand it, yes, assets includes anything you own, whether property or bank balance. I don’t think it’s difficult to police, really, since it applies to residents who are, anyway, obliged to submit annual tax returns. I understand that there is far greater transparency and communication between the Hacienda and the Inland Revenue these days as part of a wider movement, within Europe at least, against tax fraud, which is how deliberately incorrect tax returns are deemed. Fraud, in any country, is not a crime anyone wants to be accused of …
    I’ve included links above to Blevins Franks, who are the experts on this. Anything I’ve posted on my own site has been thanks to their information and expertise.

  5. Hi we are semi retired and looking at spending 6 months in Tenerife (renting a property and not working) however I have a friend with property in Spain who seems to think that if we spend more than 185 days in Tenerife we will be subject to paying 50% tax on our uk assets is this the case?

  6. I think that two things are being confused here. The new ruling in the post above is in addition to, and separate from, any general annual tax conditions. Anyone who is resident in Spain with more than €50,000 in assets outside Spain must make this declaration.
    As far as tax generally is concerned, after roughly six months of being resident in Spain you become “fiscally resident” here; before that point you are resident in the UK for tax purposes. As a fiscal resident, you are required to submit an annual tax return (this also applies to non-resident property owners). Please do speak to a gestor or accountant here, or your British accountant or financial adviser, for secure detail beyond this basic position.

  7. Hi Janet Your comment above has confused me and I would be grateful if you could just clarify once again – sorry! I have been largely ignoring these new rules because they seemed to refer to residents and as far as I understood it you are resident if you spend 183 days plus in Spain or Tenerife. At the end of paragraph 1 above you state that ‘resident means living here for three months’. I have just done a quick tot up as I was worried and my husband and I spent about 163 days plus/minus maybe a few days (not 20 though) in both Spain and Tenerife. Does this mean we should be delcaring our assets?
    Secondly, how do the authorities in Spain know how long we’ve been there? Is this simply based on our declaration or do they have other means of knowing.
    Lastly, if we need to declare assets, does this mean we will be paying taxes on the value of our house here in the UK and other investments, including tax free ISAs!

  8. Karen – no need to worry. There is a difference between Residents who are supposed to register if here for 3 months or longer and Fiscal (Tax) residents. It is the tax residents who must declare their foreign assets of over 50.000 euros. There is a (reintroduced) Wealth Tax in Spain for tax residents who have assets any where in the world of over 700.000 euros and this tax also applies to non residents who have Spanish assets of over 700.000. Range from 0.5% to over 2% for the very wealthy. Whilst the 183 days you hear about applies in general, you still have to actually register as a Tax Resident and declare yourself non tax resident in your home country.

  9. Thanks for the clarification Doreen – and what a relief! I did panic for a moment as it is all very confusing. I presume therefore we still need to be very careful not to overrun the 183 days. Do you know if the authorities do actually count the number of days we are in Spanish territories – just curious really!

  10. Karen, I’ve had this discussion with my accountants when I was between two jurisdictions for a few years. No, no one is counting (particularly as your passport is not scanned on entry) until you are subject of a tax audit (and there are few of those unless suspicious movements in bank accounts).
    Interestingly, I was told flight details could be obtained from Spanish airlines but not foreign ones ! When I did declare for tax residency in Spain, the Irish authorities demanded a formal tax certificate (so as not to have withholding tax deducted on Irish bank interest etc): to obtain this, Hacienda first wanted to see my electricity & water bills for 12 months.

  11. Wow! I guess if they become suspicious they have their ways and means but we would only need to worry if we were trying to hide something and after all, it’s the people who are hiding something they are trying to catch! Thanks for the reassurance!

  12. Hi There. I have a few questions if thats alright??! What happens if you are regarded as a tax resident and your world wide assets rise by more than 20k in a fiscal year? I understand that you will need to declare them again, but would you be liable to pay tax on the amount the assets have risen ‘on paper’ or would you only pay tax once the assets have been sold? Also what would happen if you sold a worldwide asset but in that same financial year ceased to remain a fiscal resident and spent less that 183 days in Spain in that year. Would you still be liable for tax?

  13. Hi Lincan, there are fact sheets of basic questions compiled by Blevins Franks and I’ve given links to them in the post at the top of the page. If your questions aren’t answered in those fact sheets then it’s something that really needs professional advice.

  14. Quote ‘The Spanish authorities want the value of a mortgaged UK property in total, disregarding the mortgage, and consider the value to be the original purchase cost.” … however, I understand when you enter the Wealth Tax payable bands, any mortgages or other bank borrowings are deducted, as it is your assets less your debts, i.e. your net wealth that you pay tax on.

  15. I cannot obtain the “fiscal identification number” from the various investments funds I hold. I understand it is a 6 figure number. I have the ISIN numbers but when speaking to the fund houses in the U.K. or Ireland etc. they say they don´t have this number.

  16. I’m sorry, I’m afraid I can’t help you. You need to be speaking to your fiscal adviser or accountant.

  17. A note from my accountant said the Tax ID was not essential – only put on form if you can obtain it

  18. A friend of mine has asked me to ask you about assests in the UK. He is a part owner of his parents house, they do not pay him a rent but his investment is over 70,000 euro, does he have to declare this in this new tax thing that you have to complete by the end of april. He does not work over here but has an NIE, his wife does but pays tax through the system and they live of this, also her name is not on the deeds of the house in the UK

  19. If his part share is worth more than 50,000 Euros then yes, he needs to declare … if he’s resident here. You say that he doesn’t work here. The real question is whether he lives here. If he lives here, and has done for more than six months, he’ll be deemed to be tax resident. If he’s tax resident (even if he doesn’t submit tax returns) he needs to declare.

  20. Thank you for your help Janet, where does he have to go to declare it or can he do it on line.
    Thanks again

  21. According to the second factsheet I linked to above, it can be done online, but I don’t know more than that, I’m afraid. I myself think that anyone who needs to declare would be well advised to use a professional accountant or gestor to guide them through the declaration.

  22. I have a SIPP pension fund investment, I am not drawing on it. It is over 50,0000 does this have to be declared
    Thank you

  23. Please could you have a look at the links provided in the main post above. They are to factsheets from Blevins Franks, experts in this. One of them, I know, has a list of those assets which count for declaration purposes.

  24. You just go back to the police station where you got your Certificado de Registro. Please do bear in mind that it is pointless doing this if you’re living here permanently, because the new rules apply to anyone here for more than 6 months (roughly), whether formally registered or not, or whether submitting accounts or not.

  25. I have filled in new tax form with aid of lawyer, but she is using my annuity and adding 4.5% for each year until the age of 89. Is this correct ? A annuity of £4800 adds up in her calcualtions to over £330, 000 over this 29 year period. I am 60 years of age. This is incredible, but also she submitted my form without my knowledge or agreement. To make it even more complicated my annuity is fixed and will never increase. Therebye annuity multiplied by 29 years is £175,000, nearly half what she has submitted in form 720 ???. I notified her of this and she had not realised annuities could be fixed. She notified whoever form is sent to online. When i went to collect form it still had first amount as total of my assets. a staggering £535,000. She showed me modifications she has made, so why has total not changed. She showed me the intial asset value, and all she had done was cross off initial amount and penned in new amount with the difference between her first total value and the correct total asset value.

  26. can you please clarify for me the following.
    My husband and I have joint accounts, so is the assets for 50k euro per person. or is it 50k euro jointly.
    If jointly @ 50k this is unfair. and totally discriminating against married couples.
    Thank you,.

  27. Hi Ron, I’m afraid I’m just not qualified to comment, let alone decide whether your lawyer is correct or not. If you’re unsure, it might be best to get a second professional opinion.

  28. I have just returned from my gestor who processes my annual tax return in Tenerife. I gave her the details of assets outside of Spain and the instructions and modelo 720, obtained from the Agencia Tributaria website for her to complete for me. She tells me that she has been in touch with the hacienda in Puerto de La Cruz and they have told her that the 720 isn’t needed and that the modelo 100 for the annual tax return is the only form necessary.
    I also have an English speaking Spanish friend in Puerto who has foreign assets and has been to the hacienda personally and was told the same thing.
    Referring to your post 8th April which quotes: The asset declaration applies to tax residents of Spain (or de-facto tax residents meaning those who live here full time but do not make a tax declaration).
    This appears to suggest that the declaration is only relevant to tax resident people who do NOT make an annual tax declaration.
    Therefore for those of us who live here legally and pay our taxes annually the declaration does not apply?
    Your comments will be welcome.

  29. I can only report what legislation says, and what tax experts tell me. This is that every fiscal resident of Spain, whether submitting tax returns or not (and the default is that they should be), must declare foreign assets totalling over 50,000 Euros. I myself know two accountants in Los Cristianos who are overwhelmed with this … and recognize the requirement. If some gestors, or even the tax office itself, aren’t up to date, guess who the buck is going to stop with …

  30. Quoting Chris: This appears to suggest that the declaration is only relevant to tax resident people who do NOT make an annual tax declaration.

    This is incorrect – I am a fully compliant tax resident and have spent a lot of time supplying information to my accountants here (Deloittes) to submit my Modulo 720. I would certainly hope one of the top accountancy firms would know the correct procedures, ditto Blevin Franks who Janet is quoting 🙂

  31. The Form 720 should include any assets over 50, 000 euros even if they are in joint names. Each person would have to declare the full joint bank account balance for example.
    The declaration should be made by each person who is or isn’t making a normal resident tax declaration if he/she is spending over 6 months a year in Spain…under most circumstances that is.
    If one is making a yearly tax return in Spain and the income is declared from an out-of-Spain asset on the yearly tax return, the asset itself still has to be declared.
    Please feel free to make contact with me…Paul.
    Janet – edit: Paul is from Blevins Franks. His direct contact details are HERE.

  32. Chris, I suggest you contact your Gestor urgently and quote this:
    Como medida complementaria a la regularización voluntaria o “amnistía fiscal” aprobada por el gobierno a través de la presentación de la Declaración Tributaria Especial, en la Ley 7/2012, de 29 de octubre de modificación de la normativa tributaria y presupuestaria y de adecuación de la normativa financiera para la intensificación de las actuaciones en la prevención y lucha contra el fraude, se estableció una nueva obligación tributaria de carácter formal, la obligación de información sobre bienes y derechos situados en el extranjero que ha sido objeto de desarrollo reglamentario a través del RD 1558/2012, de 15 de noviembre, por el que se adaptan las normas de desarrollo de la Ley 58/2003, de 17 de diciembre, General Tributaria, a la normativa comunitaria e internacional en materia de asistencia mutua, se establecen obligaciones de información sobre bienes y derechos situados en el extranjero, y se modifica el reglamento de procedimientos amistosos en materia de imposición directa, aprobado por Real Decreto 1794/2008, de 3 de noviembre.
    I wonder is she likely to have professional indemnity insurance high enough to cover all the fines her clients could be exposed to !!

  33. Thank you for the responses containing the information contained in the relevant Real Decreto and Boletin Oficial del Estado which I supplied to my Gestor.
    My problem is not with the information we all have but with the Hacienda in Puerto de la Cruz who refuse to accept this information.
    Can someone suggest how or where I might submit the 720 as my tax office won’t accept it?

  34. It may be of interest to know that I have now resolved the problem which arose from not realizing that the Declaration can only be made on line and was compounded by the fact that the Hacienda in Puerto is obviosly not aware of the latest legislation and is advising that the declaration is not necessary.
    It is therefore understandable that one would unwittigly believe the Hacienda whom you would have thought should know!

  35. Thanks for confirming that Chris … and yes, it would have been perfectly understandable! And the buck would have stopped with you!

  36. I realize this is good information that’s given here yet I have to say (although not an accountant) that I am a bit skeptical as to whether spending more than 183 days in Spain automatically makes a tax resident subject to the model 720 requirements. If you have important family ties in the UK (“center of vital interests” I think they call it) and are a UK national then both Spain and UK could claim you as a tax resident and then tie breaking rules apply in which case center of vital interests or ‘permanent’ home trumps number of days spent in Spain. See for instance: http://www.us.kpmg.com/microsite/tax/ies/tea/summer2003/stories/article06.htm. Also, beware that the Spanish law stipulates that “short temporary absences” from Spain are counted towards the 183 days tally. Yeah, I know it’s vague; worst thing is I am afraid it is vague on purpose.

  37. I am now 70 years old with a couple of small pensions living alone and
    was wondering if spending over the 183 days as a student learning the culture and language, would allowances be made in this case not being resident here. Are there any exceptions to this ruling. I do not own a property here, but do in uk. I am renting a property from 1st of april this year… appreciate any advise

  38. Myself and partner remortgaged one of our properties in the UK and used the money to buy and renovate a property in Spain. We then spent 12 months living, but not working in Spain (September 2011-Setember 2012). We paid, and continue to pay various annual taxes for refuse collection, car etc. I do not recall ever registering as resident in Spain. My first question is should I have done so?
    We are hoping to return to Spain in April 2015 for at least 2 years when we hope to open up a B&B type establishment. My Partner bought her house many years ago for around £30,000 and I bought my apartment 10 years ago for £82,000. My 2nd question is what must we declare if/when we return to Spain and what will the financial implications be?

  39. Technically, yes, if you were here for three months you should have registered. As far as the declaration is concerned, you will need to declare anything outside of Spain valued at over €50,000. Beyond that basic information, you would be well advised to seek out an accountant or gestor to submit your returns – if you are paying taxes here you may already have one – and they will be best advised as to making the foreign asset declaration. At present there is no implication to this, it is just a declaration. Whether this remains their policy is anyone’s guess, really.

  40. Cripes this is confusing – as we are looking to long term let we have to register when we have been in Tenerife no longer than 3 months? Do we have to have a bank account in Tenerife or just access to accounts on line? We have assets worth €50,000 – how much tax would we have to pay and how much roughly would accountants charge?

  41. I’m afraid you will have to check with your financial adviser or accountant for any tax issues (I don’t know their fees, and they will depend on what you are employing them to do), but at present I can at least confirm that there is no tax payable on assets declared under these new rules. It is merely a matter of declaration of assets – not a tax on them. As far as a bank account is concerned, you might well find it easier to live and rent a property here if you have a bank account, but there’s no legal requirement.

  42. I’m going back to the UK from April 6 2014.

    If I sell assets now to whom am I liable for tax? I won’t be in Spain for 183 days but I have not started the tax year in the UK. To which tax authority should I submit my return for this period, UK or Spain?

  43. Hi James, this is nothing to do with this requirement, because if you are in Spain for fewer than 183 days you are almost certainly not tax resident in Spain. As such, you won’t be required to submit a declaration about assets held outside of Spain. As to tax for selling things in Spain itself, if you’re selling a property, as a non-resident you will find 3% of the sale price retained in Spain against any possible capital gains tax payable without the need for a declaration at all. To get it back, your usual accountant or gestor will be able to advise.

  44. Hi Janet,
    I have a question. Last year I submitted an overseas asset report; this March I transferred 75 thousand worth of Euros to Sterling, and forgot about it. I did not submit an amended asset report this year. Does this mean I will be subject to the minimum 10,000 Euro fine? Is there anything I can do to avoid this. Can I also point out that these rulings penalize the elderly; we are forgetful!
    Many thanks for your reply, Gaynor

  45. Hi Gaynor, I can’t imagine that there’s no system in place to “forgive” errors! And you might anyway be able to submit a late return. To put your mind at rest, and do whatever needs doing, get in touch with Paul Montague of Blevins Franks. He has been very helpful indeed throughout my website with tax advice, and making tax guides available in downloadable form for my readers. His email is paul.montague@blevinsfranks.com and I’m sure he’ll be pleased to advise, and maybe help if help is possible. He’s the one with professional knowledge and expertise in this area.

  46. You should not be penalised at all Gaynor – my understanding is that you must submit a new Mod 720 if the values declared have increased by 20,000 euros – you will have made a currency gain, but not significant enough to require a new submission.

  47. HELLO,

  48. As it says above, “The asset declaration applies to tax residents of Spain (or de-facto tax residents meaning those who live here full time but do not make a tax declaration). Under 99% of circumstances, a person is not deemed to be tax resident unless they spend 183 days or more in Spain so the swallows who spend 5 months a year in Spain for example, do not have to make a declaration for asset reporting.” For any other tax advice, please approach tax specialists, like Blevins Franks, whose link is in the post above.
    Please read the first answer HERE for your question about “residency”.
    As to your baby’s status, I’m afraid I can’t claim to be sure of this, but my understanding is that Spanish nationality acquired by birth depends on certain circumstances – it is not enough just to be born in Spain. If neither parent is Spanish, neither was born in Spain, and both have nationality in another country (as opposed to being stateless) – or their nationality is such that it will not cause the child itself to be stateless – then I don’t believe that the child’s birth in Spain entitles him of itself to Spanish nationality. This is something you simply need to check with your own national authorities and the Spanish embassy in your home country.
    A child born here, however, can acquire Spanish nationality after one year’s residence, but I don’t know about rules requiring “continuous” residence. Again, this is something you simply must check with any relevant authorities and embassies or consulates. The relevant law is HERE, articles 17ff.

  49. Hi Janet,I have 6 bank accounts,3 of which are small,however 1 of these will have risen by more than the stated 20000euros.Financial entities is the only category I declare,having no property nor suficient bonds etc..Do I declare EVERY bank account again or only the one which has exceeded 20000 euros? Thank you,Norman.

  50. The Blevins Franks info says that you only need to submit a new declaration if your assets have increased by €20,000 or more. This does suggest, though, that a complete new declaration is needed. As I always say with tax issues, however, advice needs to be sought from qualified professionals.

  51. There is too much emphasis on where one spends 183 days. Although this is one of the guidelines HMRC use for establishing which country you as resident in, it is not the most important. Family and business ties carry more weight. The HMRC rules are more important than the Spanish rules for British people. Each country’s rules are different but where there is a conflict the tie breaker according to the DTA between uk and spain is what country issued your passport. So under Spanish rules a uk passport holder might fall under the category of Spanish resident due to the 183 days but if under uk rules you are considered a UK tax resident due to having property and/or dependent relatives and/or a business in the uk then the UK rules will apply.

  52. Surely the issue is in Spain – it is Spain who will issue a fine if they deem you resident and you haven’t declared …

  53. Hi Janet,my partner is older than me and unfortunately has acute memory loss;it has come to light that there is a bank account she forgot about (no kidding!).This might have the effect of putting her over the spanish declaration limit,she didn’t declare last year what should she do? it was purely an oversight.Norman.

  54. Hi Norman, best will be to contact Blevins Franks who supplied me with the information. They are the experts on this.

  55. Hi Janet, my partner and I have a joint bank account in the UK of over 50K, we live in spain but because we are not married do we still need to declare it?

  56. As Paul Montague has said in one of the answers slightly above, “Form 720 should include any assets over 50, 000 euros even if they are in joint names. Each person would have to declare the full joint bank account balance for example. The declaration should be made by each person who is or isn’t making a normal resident tax declaration if he/she is spending over 6 months a year in Spain…under most circumstances that is. If one is making a yearly tax return in Spain and the income is declared from an out-of-Spain asset on the yearly tax return, the asset itself still has to be declared.” Paul Montague is a tax expert for Blevins Franks, and his contact details are in the post above for further information if needed.

  57. Hi, very interesting thread and very good of you to be sharing your knowledge. I have a new question and would be very grateful for your insights. I am about to do the declaration for 2014 but am worried that they are going to fine me for not doing it last year (corresponding to 2013). My case is that I arrived in Spain in November 2013 but I immediately made myself resident because I needed to import my own furniture from Asia (where I had been living before). In November and December 2013 I was therefore a resident in Spain but I lived off savings during that time (not investments or interest, etc) so I did not do a tax return in 2014 to cover 2013. Should I have done the declaracion de bienes though? I have asked my gestor and basically they do not know the answer. If by doing the declaration this year I am liable to be fined for not doing it the previous year, then I am inclined to move countries fairly rapidly. Many thanks!

  58. Hi Steven, as I’ve said above several times, I’m not a tax expert, and people should speak to someone qualified. I’ve given links in the latest update for Blevins Franks, and specifically for Paul Montague, who’s their expert representative in the Canaries, or you could speak to Diana McGowan, an asesora here whom I’ve also recommended previously, and who is qualified to advise. These are the people to ask, rather than me, I’m afraid. Any knowledge shared is theirs, not mine.

  59. Steven, presumably you were not a tax resident in Spain in 2013, only had registered with your local Town Hall so as to be able to import your goods. I hope you did make a tax declaration for 2013 in the country you had just moved from.

  60. Dear Steven
    The general residence law in Spain states that if you do not spend more than 6 months in Spain during the Spanish tax year (calendar year), then you should not be deemed tax resident. Since you only spent a short time in Spain during 2013 (no more than 2 months unless there are more not stated), I feel that the Hacienda would have a difficult time proving that you belonged to Spain financially for 2013. However, you may have previous time spent in Spain and periods of temporary absence do not count so to be certain, a full “picture” is needed. Was any family member living in Spain previously? And yes, the big question is: which country, if any, did you last submit a tax declaration to and for what period? This is very important as it creates a certainty if questioned. If all your situation is clean cut with no connections to Spain previous to relocating here, then I would make an asset disclosure for 2014 before the end of March and a “normal” tax return for 2014, even if you have no regular income or if your total income is below the tax free allowance, before the end of June.

    I Hope this is useful to you.

  61. could you explain? What law concerning a cedula? In connection with foreign asset reporting?

  62. Hi all,

    I have two question. Please advise. I’m considering living in Spain full-time. My child currently lives in Spain with the mother and I would like to spend more time with my child. I never married the mother. Does having a chiId in school in Spain class me as being a spanish resident for tax purposes ?

    My second question related to the declaration of assets. Does the total monies in bank accounts include my personal and my business account. Or do I only include my personal bank accounts?


  63. No, living in Spain for more than 183 days a year is what classes you as Spanish resident for tax purposes. As to what needs to be included in the declaration, there’s a link in the post above to a guide provided by Paul Montague of Blevins Franks specifically to completion of the Modelo 720. As that document says, “You are obliged to report assets if you are the owner, the settlor of a trust of which you can benefit, authorised signatory, or you have the authority to dispose of the asset. This includes assets held by a company, a trust or fiduciary.” Beyond what you can see in the post above, including additional information that there are links to, you need to speak to a qualified financial adviser.

  64. I’ve just read the Blevins Franks article about the EU letter re disproportionate fines. It strikes me that the level of assets which would trigger the need to submit a report is a tiny proportion of the value of assets which would incur tax. If you assume a normal distribution of wealth. then the vast majority of people who must report won’t pay wealth tax. so it seems that a great many Modelo 720s must be processed by the Hacienda with no hope of collecting tax. However, those people in that position form a huge pool to extract outrageous fines for late or no reporting. Perhaps cynical, but why else would they not set the reporting level at, say 75% of the minimum for wealth tax, saving themselves much work?

  65. I have found all this of real interest. I have one question about world wide assets. My understanding is you will only be taxed on any asset above The threashold of euro 700,000. Is my understanding correct?
    I understand all of the other tax well explained already

  66. I would be interested to know if any progress has been made regarding the European Commission on the infringement procedure against Spain for its obligation on fiscal residents with assets of over €50,000 outside of Spain and Modelo 720? Spain had two months to make the corresponding claims and arguments and over three months has passed from the EC taking action.

  67. You will need to ask fiscal or EU law experts, I’m afraid. I myself haven’t heard anything more.

  68. Our gestor has told us that as we have a total of 47,700 euros in joint accounts but also that we have two accounts which are not joint accounts – one in my name and one in my husband’s name with 23,000 euros in each account – we do not have to make a declaration 720 for our bank accounts. So although we have 93,700 euros between us we do not jointly have more than 50,000 euros. Is he correct please?
    Many thanks.

  69. As Paul Montague says above, “the Form 720 should include any assets over 50,000 euros even if they are in joint names. Each person would have to declare the full joint bank account balance”. By my reading, therefore, you each have to declare the full value of the joint account (€47,000), which takes you over the 50,000 limit when you add the sole accounts. I’m afraid that I can’t advise beyond this, but to me it does appear that Paul’s advice contradicts that of your gestor. If you are seeking a second opinion, however, I would advise you to get in touch with Paul direct as he is qualified to answer.

  70. Hi

    A spanish national is earning a salary in Spain and has filed income tax every year and had, let’s say, a saving of 100,000 Euro. He then decides to shift some money abroad in to a country where on his investments he can earn good interests.
    He transfers thru bank 20,000 euro in 2013, then 20,000 in 2014. So in 2014 his total asset in account abroad was 40,000 + 2000 euro interest = 42,000.
    In 2015 he transferred another 19900 euro of his savings. So now the total balance in his account
    is 62,000 euro.

    In such a case, would he be required to submit Form 720?
    Please keep in consideration that (a) he has transferred his saving from salary income already declared in Spain (b) he has declared every year all interests earned on his investments abroad (c)
    his bank balance of his increased by 19,200 in 2015 with respect to year 2014 when he was not qualified to submit form 720.

    Look forward to hearing from you.


  71. I’m sorry but you will need to consult a qualified tax professional, perhaps Paul Montague who is mentioned in the above post – there is also a link to his contact details.

  72. The example is all very hypothetical, but the rule is once you have assets abroad of 50,000 or more, you must submit a Mod 720: the increase of 19.200 is not relevant if no previous Modelo has been submitted. Likewise, it makes no difference that the money comes from a salary already declared in Spain.

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